I’ve often thought about setting up a sign somewhere on the gravel road into the ranch. It would say “End of the World 12 Miles, Wilson Ranch 13 Miles.” Living in the boonies does have its benefits, like the time I forgot my pants in the house and was getting into the pickup when I realized that the leather seats were a little cooler than normal. The downside to living in the boonies is that sometimes we forget that there is a whole other world out there.
After more than 11 years of restrictions, it was announced June 17 that Hong Kong has agreed to fully open its borders to U.S. beef and beef products. How significant is this? Well in 2013, Hong Kong was the fourth largest market for U.S. beef and beef product, and 2014 looks to top those figures from last year. Hong Kong is not the only country jumping on the U.S. Beef Train as Ecuador, Mexico, Uruguay and Sri Lanka also lifted restrictions earlier this year.
So … what’s that mean to the boonie dwellers? CattleFax estimates that exports added $307/head value in 2013, and with countries importing more product, that value looks to go up.
There’s a couple developments coming down the pipeline for trade. One big one to keep an eye on is the Trans-Pacific Partnership (TPP), which is in negotiations by the U.S., Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam, Canada and Mexico. Full market access to all TPP countries would not only give us the ability to compete, but will only add value to those carcasses.
Trade is a sensitive issue — not near as sensitive as saying the word “Redskins” in DC this week, but in order to receive you have to play nice. Canada and Mexico are two of our leading trade partners, together accounting for $2.1 billion — yes, that is billion — in beef exports. I understand I spent nine days eating, breathing and sleeping NCBA during the Young Cattleman’s Conference, but my opinion has not changed. I thought MCOOL was dumb before I went, and it’s just as dumb now. Retaliation is never pretty, and this has and will continue to get ugly and uglier.
Do packers control our industry? For some people, they do, but there is a whole bundle of opportunities to find those niche spots. Branded beef programs, grid marketing, genetic marketing, NHTC, natural, grass-fed — the list goes on of value added programs that can pad the pocketbook. Instead why implement something that will cost the industry millions and carry down to us boonie dwellers. Research is showing that the majority of consumers won’t care what’s on the label, much less look at it.
If you buy beef at a grocery store, ask yourself, when was the last time you looked at a label? Did you look at the label before the price tag? Do you classify yourself as an average consumer? Do you care who’s paying for the changes and who those changes will be passed onto? I will guarantee it’s not going to be the packers that will absorb the financial implications.
Beef exports is a huge area of possibility for U.S. beef producers, but in order to continue to be an advantage, we have to play nice, and MCOOL is not nice. Contact your delegation and show your support for opening all trade!
